[Source: Business Daily, by George Bodo]
The tussle created in the Senate by the third basis for equitable sharing of revenue among county governments may not be the last. In fact, there are all indications that subsequent bases will not lack contention(s).
The row is partly borne out of the fact that while Article 209 of the Constitution assigns tax powers to the two levels of government, it gives limited tax powers to devolved units.
Article 209 mandates county governments to collect only property and entertainment taxes, and fees and charges for services rendered.
The problem is that these taxes are inadequate to finance all the devolved functions. For instance, in the fiscal year 2018/19, the aggregate own source revenue raised by county governments stood at Sh40.3 billion, against the annual target of Sh53.9 billion.
This underperformance, as the Commission for Revenue Allocation (CRA) notes, results in an imbalance between county governments’ expenditure responsibilities and revenue raising powers, which creates a…
